Post by
WheresMeGold on Jul 10, 2017 5:15pm
Years of damage under the best-case scenario
The best-case scenario is that an injunction allows mining to resume within a couple of months and a higher court eventually determines mining should continue. The stock would obviously rebound. However, the risk that will be permanently priced into the stock is very large regardless of how well this turns out.
Guatemala has made a huge mistake as it will discourage other businesses to set up shop. And companies already there, such as Tahoe, will see their assets in Guatemala re-priced lower for many years to come.
The best course of action for Tahoe is to make the best of a bad situation, somehow get the mine open again, suck up as much money from the mine as possible, redeploy the money elsewhere, deplete the mine, and get out of town. Part of the appeal I had for Tahoe was its presence in Guatemala and the advantage that presence gave Tahoe in exploring Guatemala, a country with great exploration potential. That appeal is now completely gone.
Comment by
Weeble on Jul 10, 2017 5:29pm
Guatemala has made a huge mistake as it will discourage other businesses to set up shop. That is exactly what they said about Pacific Rim's/Oceanagold's investment in El Salvador. In the end, it didn't matter.